Is the ‘three warning’ rule an urban myth?

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'But you haven’t given me three warnings!' – it's a phrase many HR managers would have heard from aggrieved employees during disciplinary meetings. But does this commonly held belief hold any real legal weight? HRM sat down with a top employment lawyer to find out.

Carl Blake, senior associate at Simpson Grierson, said that there is no particular law that specifies the number of warnings employees should be given prior to dismissal.

“There’s nothing in any legislation that talks about a specific number of warnings,” Blake said. “But it is commonplace for employers to give a certain number of warnings prior to dismissal.”

He added that in most cases, this is expected and required of employers.

“The starting point for determining how many warnings are required would be looking at the company policy,” Blake told HRM.

“The employer is free to include a reference to their chosen system of pre-dismissal warnings in their Code of Conduct or employee handbook, outlining what type of sequence this would be.

“In most cases, it would involve a verbal or written warning, followed by a final written warning and then dismissal; or a first written warning, a second written warning and then dismissal.”

However, he warned HR to ensure that the policy leaves the employer with some leeway.

“Best practice would be to make it clear that that this sequence could be deviated from,” Blake advised.

“This covers employers in cases where something is so serious that the disciplinary procedure could consist of a first and final warning.”
 
Using first and final warnings

Blake added that most companies give employees at least two warnings before terminating their employment.

“However, a first and final warning could be sufficient depending on the seriousness of the misconduct,” he said, reminding HR that they must also consider whether their actions are fair and reasonable.

“A first and final warning would put you under more scrutiny around whether the behaviour was serious enough to warrant that response.”
 
Warnings outside of formal policies

“If an employer didn’t have a policy to fall back on, I’d suggest following the standard norms,” Blake told HRM.

“Best practice would be to give at least two formal warnings for problems related to either performance or misconduct – obviously in cases of serious misconduct, no warning is needed.

“Any deviation from that could potentially open you up to a challenge.”
 
Misconduct vs poor performance

Would HR be required to follow different procedures depending on whether the employee was being disciplined for misconduct or performance issues?

“Generally you’d expect them to follow the same processes,” Blake explained.

“Even though they involve different employee conduct, it’s more usual for employers to have policies where the procedure would be a first written warning, a final written warning and then dismissal for both general misconduct and poor performance.

“It’s very unusual to see a first and final warning for poor performance – that would be dangerous compared to using the same system in a case of misconduct.”

He added that employers should use their discretion when it comes to determining the appropriate procedure for instances of misconduct.

“There’s a fine line between general misconduct and serious misconduct,” said Blake.

“The door is open for you to look at whether the employee has crossed that line – so a first and final warning could potentially be used in a case where misconduct is just below the line of serious misconduct.”

Blake also had some advice for employers who wanted to give a first and final warning but hadn’t prepared for this in their policies.

“If an employer didn’t have a policy about using first and final warnings but wanted to give one, the safest way to do so would be to have determined that the employee’s behaviour was so serious as to have justified dismissal, but based on mitigating factors you have decided to give the employee a second chance,” he said.

“So even though you could have dismissed them, you have opted to give them the benefit by electing not to dismiss them for their serious misconduct.

“This certainly helps if their behaviour has been so serious that you could dismiss them but are erring on the side of giving them a second chance.”

  • Steve Punter on 16/11/2015 12:11:34 p.m.

    I advocate a 3-event process - (1) First Written Warning, (2) Final Written Warning, & then (3) Termination. Verbal warnings can be disputed and you have to document it anyway. I use 'Final' rather than '2nd' because '2nd' indicates there might be a '3rd', whereas 'final' cannot be misinterpreted.
    As Carl says, a 'First & Final Warning' (i.e. one event) needs to be used cautiously, for an offence where Instant Dismissal would normally apply but where there is some mitigating circumstance such that the employer might want to stop short of that, and it is in the employees interest to do so. I have also heard the expression 'permanent final warning' which apparently survives on the employees record in perpetuity - I have never used it, and it's probably challengeable as unfair. Even criminals usually get out of jail at some stage!

  • GB on 16/11/2015 12:00:41 p.m.

    A really helpful article that basically reflects how I do business.
    Starting point is an informal, then formal and then final warning. Around that is an assessment of the relative seriousness of the situation. In some serious situations we have gone straight to formal final warning - this is perhaps the like of a valued employee who has made a serious mistake, however has no history of previous issues, who demonstrates appropriate remorse, welcomes re-training and commits to a period of increased accountability.
    In saying that some serious issues that hit to the heart of trust and confidence in the employment relationship, simply do not pass go to collect $200 dollars.
    Most employee's will make some mistakes, and are prepared to be accountable and responsible to remedy these. Supporting an employee through a disciplinary process that has good outcomes for them and the organisation is a win all around.

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